What is the journal entry to write-off a receivable?
Assuming the allowance method is being used, you would have an allowance for doubtful account reserve already established. To write-off the receivable, you would debit allowance for doubtful accounts and then credit accounts receivable.
The visual below also includes the journal entry necessary to record bad debt expense and establish the allowance for doubtful accounts reserve (aka bad debt reserve or uncollectible AR reserve).
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What is the journal entry to record bad debt expense?
Under the allowance method, the company would establish an allowance for doubtful account reserve, which is a contra-asset. When the company believes there is a risk that they won’t collect $100 from a customer who is going through bankruptcy, then they would debit bad debt expense and credit allowance for doubtful accounts. When the company...
What is the journal entry to record bad debt expense?
Under the allowance method, the company would establish an allowance for doubtful account reserve, which is a contra-asset. When the company believes there is a risk that they won’t collect $100 from a customer who is going through bankruptcy, then they would debit bad debt expense and credit allowance for doubtful accounts. When the company...
